In late March, the Department of Interior’s (DOI) Bureau of Land Management (BLM) released its long awaited final rule on hydraulic fracturing on public lands. The rule could impact as many as 36 million acres of federal lands in 33 states and approximately 46,000 active federal leases.  The rules represent an attempt by the Obama administration to set up a baseline for hydraulic fracturing standards that can be utilized by states to ensure that they are employing the most protective standards. Highlights of the rules include:

• Companies must submit detailed information for BLM to approve before an operation can commence.
• Safety standards that include validation of well integrity and strong cement barriers between the wellbore and water zones to ensure that groundwater is adequately protected.  
• Disclosure of the contents used in fracking fluids on fracfocus.org within 30 days of completing fracking operations.
• Use of steel tanks to store recovered waste fluids in the fracturing process in order to protect the air, water, and wildlife.
• Measures to lower the possibility of cross well contamination with fluids utilized in fracturing operations. This will also require oil and natural gas producers to submit more detailed information on the geology, depth, and location of pre-existing wells.

The rule has already been criticized by both Republicans and Democrats in Congress and was a large topic of discussion at a recent hearing of the House Natural Resources Energy and Minerals Subcommittee which featured Neil Kornze, the current Director of the BLM. In his opening testimony Director Kornze said that BLM sees the rule as a conservative menu of industry best practices that most states with regulations have already met or exceeded. He also said that the BLM is planning on crafting memorandums of understanding with states such as Colorado and Wyoming that already have stringent standards but that the rule was meant to set up a framework for states that currently do not have standards.

Congressman Doug Lamborn (R-CO), the Subcommittee’s Chairman, said that he believes that the new regulations are unnecessary because they are duplicative in nature and will raise costs for oil and gas development on these lands, most of which are in the Western U.S. In addition, he said that regulation at the state level makes more sense because states have a better understanding of their geology and other resources. He also questioned BLM’s capacity to administer the rulemaking; BLM Director Kornze acknowledged the fact that the Agency does not currently have enough personnel, although if Congress supports the President’s budget request, there would be increased funding to ensure that qualified personnel could be hired. Director Kornze also noted that there would likely be close state/federal coordination on inspections and other oversight activities.

On the other side of the aisle, Ranking Member Alan Lowenthal (D-CA) said that he does not believe that the rule will have much impact on oil and gas development at all and that many of the complaints about the rule are overblown by Republicans. He also said that he believes that some federal jurisdiction is appropriate in this area and that the rule is merely a set of best practices that the industry should be following already anyway. Congressman Jared Polis (D-CO), an outspoken opponent of fracking, said that he does not think that the new rules are adequate, but that he was glad to see that some level of federal regulation has been implemented.  He also noted that he, along with Representatives Matt Cartwright (D-PA), Jan Schakowsky (D-IL) and Diana Degette (D-CO) had recently reintroduced the FRAC Pack, which is a package of bills that looks to impose more stringent federal regulations.  The FRAC Pack includes the following bills:

• FRAC Act - Would regulate fracking under the Safe Water Drinking Act.
• BREATHE Act - Would end exemptions to federal air pollution rules and require that the emissions from individual oil and gas wells are aggregately treated as a “major source”.
• SHARED Act - Would require that groundwater be tested before and after energy development.
• FRESHER Act - Would require oil and gas producers to obtain permits for any activities that would increase stormwater runoff.

The House Natural Resources Committee’s recent hearing on the BLM fracking rule will not be the last word on this issue in Congress. The Senate Energy and Natural Resources Subcommittee on Public Lands has scheduled a hearing for April 30 and the House Natural Resources Committee is likely to have more oversight hearings on this topic as well.